NOTICE
OF
ANNUAL MEETING
OF
STOCKHOLDERS
AND
PROXY STATEMENT
Beneficial owners of stock held by banks, brokers
or investment plans (in "street name") will need
proof of ownership to be admitted to the meeting.
A recent brokerage statement or letter from your
broker or bank are examples of proof of ownership.
COMPAQ LOGO!
Compaq Computer Corporation 20555 SH 249
PO Box 692000 Houston, TX 77070-2698
Houston, TX 77269-2000 Tel 713-370-0670
COMPAQ LOGO!
March 8, 1996
Dear Stockholder:
Compaq Computer Corporation's annual meeting of
stockholders will be held Thursday, April 25, 1996, at
10:00 a.m. at the Conference Center, CCA5, Compaq
Computer Corporation, 20555 SH 249, Houston, Texas.
Details of the business to be conducted at the
annual meeting are provided in the enclosed Notice of
Annual Meeting of Stockholders and Proxy Statement.
On behalf of the Board of Directors and employees
of Compaq, I cordially invite all stockholders to
attend the annual meeting and hope you will be able to
attend in person. If you are unable to attend in
person, please sign and promptly return the enclosed
proxy card in the enclosed prepaid return envelope.
Your shares will be voted at the annual meeting in
accordance with your proxy. If you plan to attend the
meeting in person, please remember to bring your
identification as a stockholder.
Sincerely,
Eckhard Pfeiffer
President and Chief Executive Officer
Compaq Computer Corporation 20555 SH 249
PO Box 692000 Houston, TX 77070-2698
Houston, TX 77269-2000 Tel 713-370-0670
COMPAQ LOGO!
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To be Held April 25, 1996
To the Stockholders of
Compaq Computer Corporation:
NOTICE IS HEREBY GIVEN that the annual meeting
of stockholders of Compaq Computer Corporation, a
Delaware corporation (the "Company"), will be held at
the Conference Center, CCA5, Compaq Computer
Corporation 20555 SH 249, Houston, Texas, on
Thursday, April 25, 1996, at 10:00 a.m., Houston
time, for the following purposes, as more fully
described in the accompanying Proxy Statement:
(1) To elect ten directors; and
(2) To act upon such other business as may properly
come before the meeting.
The close of business on February 27, 1996, has
been fixed as the record date for determining the
stockholders entitled to notice and to vote at the
annual meeting.
By Order of the Board of Directors
Wilson D. Fargo
Secretary
March 8, 1996
It is important that your stock be represented at the
meeting regardless of the number of shares you hold.
Please complete, sign, and mail the enclosed Proxy in
the accompanying envelope even if you intend to be
present at the meeting. Returning the Proxy will not
limit your right to vote in person or to attend the
annual meeting, but will ensure your representation
if you cannot attend. If you have shares in more
than one name, or if your stock is registered in more
than one way, you may receive more than one copy of
the proxy material. If so, please sign and return
each of the proxy cards you receive so that all of
your shares may be voted. The Proxy is revocable at
any time prior to its use.
COMPAQ COMPUTER CORPORATION
20555 SH 249
Houston, Texas 77070
PROXY STATEMENT
for
Annual Meeting of Stockholders
To Be Held April 25, 1996
VOTING AT THE MEETING AND PROXIES
On March 11, 1996, Compaq Computer Corporation, a Delaware
corporation (the "Company"), will mail this Proxy Statement to
stockholders entitled to vote at the Company's Annual Meeting
of Stockholders on April 25, 1996. Stockholders of record at
the close of business on February 27, 1996, will be entitled to
vote at the meeting and will receive a copy of this Proxy
Statement, furnishing information relating to the business to
be transacted at the meeting. On February 27, 1996, there were
268,092,992 shares of the Company's common stock, $.01 par
value (the "Common Stock"), outstanding. Each share of Common
Stock entitles the holder to one vote on each matter presented
at the meeting. The 1,359,114 shares of Common Stock held in
the Company's treasury will not be voted.
A proxy card is enclosed for your use. YOU ARE SOLICITED
ON BEHALF OF THE BOARD OF DIRECTORS TO SIGN, DATE AND RETURN
THE PROXY CARD IN THE ACCOMPANYING ENVELOPE, which is postage-
paid if mailed in the United States.
Regarding the election of directors, you have three
choices: By checking the appropriate box on your proxy card
you may (i) vote for all of the director nominees as a group;
(ii) withhold authority to vote for all director nominees as a
group; or (iii) vote for all director nominees as a group
except those nominees you identify in the appropriate area.
See "General Information" under Election of Directors.
Abstentions and broker non-votes will be counted as
present for purposes of determining the existence of a quorum
at the Annual Meeting. Abstentions will be treated as shares
present and entitled to vote for purposes of any matter
requiring the affirmative vote of a majority or other
proportion of the shares present and entitled to vote. With
respect to shares relating to any proxy as to which a broker
non-vote is indicated on a proposal, those shares will not be
considered present and entitled to vote with respect to any
such proposal. With respect to any matter brought before the
Annual Meeting requiring the affirmative vote of a majority or
other proportion of the outstanding shares, an abstention or
non-vote will have the same effect as a vote against the matter
being voted upon.
You may revoke your proxy at any time before it is
actually voted at the Annual Meeting by (i) delivering written
notice of revocation to the Secretary of the Company, (ii)
submitting a subsequently-dated proxy, or (iii) attending the
meeting and withdrawing the proxy. You may also be represented
by another person present at the meeting through executing a
form of proxy designating such person to act on your behalf.
Each unrevoked proxy card properly executed and received prior
to the close of the voting will be voted as indicated. Where
specific instructions are not indicated, the proxy will be
voted for the election of all directors as nominated.
Compaq Computer Corporation's Summary Annual Report to
Stockholders and Form 10-K for the year ended December 31,
1995, including consolidated financial statements, are being
mailed to all stockholders entitled to vote at the Annual
Meeting. These reports do not constitute a part of the proxy
soliciting material.
The expense of preparing, printing and mailing this Proxy
Statement will be paid by the Company. To assist in the
solicitation of proxies, the Company has engaged Corporate
Investor Communications, Inc. ("CIC") at a fee of $9,000 plus
reimbursement of its out-of-pocket expenses. In addition to
the use of the mail, proxies may be solicited personally or by
telephone by regular employees of the Company as well as by
employees of CIC without additional compensation other than
reimbursement of out-of-pocket expenses. The Company will
reimburse banks, brokers and other custodians, nominees, and
fiduciaries for their costs in sending the proxy materials to
the beneficial owners of the Common Stock.
Proposal
ELECTION OF DIRECTORS
General Information
The Company's Board of Directors currently consists of ten
directors. Each of the directors was elected by the
stockholders at the last Annual Meeting, with the exception of
Lawrence T. Babbio, Jr., who joined the Board in September
1995, and Lucille S. Salhany, who joined the Board in March
1996. Directors elected at the Annual Meeting will hold office
until the next Annual Meeting at which their successors are
duly chosen and qualify, or until their earlier resignation or
removal. The Board of Directors has inquired of each nominee
and learned that each will serve if elected. In the event that
any of these nominees should become unavailable for election,
the Board of Directors may designate substitute nominees, in
which event the shares represented by the proxy cards returned
will be voted for such substitute nominees unless an
instruction to the contrary is indicated on the proxy card.
The nominees receiving a plurality of the affirmative vote will
be elected.
Information Concerning Nominees
BENJAMIN M. ROSEN Director since 1982
Benjamin M. Rosen, age 63, was appointed Chairman of the Board
of Directors of the Company in 1983. He has been Chairman of
Rosen Motors, which designs hybrid electric powertrains, since
1993. He has served as Chairman of the Board of Sevin Rosen
Management Company, a venture capital firm, since 1981. Mr.
Rosen is a director of Capstone Turbine Corp., a privately-held
technology company. He is also Vice Chairman of the Board of
Trustees of the California Institute of Technology.
ECKHARD PFEIFFER Director since 1991
Eckhard Pfeiffer, age 54, was elected President and Chief
Executive Officer and appointed a director of the Company in
October 1991. He joined the Company in September 1983 as Vice
President, Europe and was elected Senior Vice President,
International Operations in January 1986, President, Europe and
International Division in May 1989, and Executive Vice
President and Chief Operating Officer in January 1991. He also
serves as a director of Bell Atlantic Corporation.
LAWRENCE T. BABBIO, JR. Director since 1995
Lawrence T. Babbio, Jr., age 50, has served as Vice Chairman
and Director of Bell Atlantic Corporation since February 1995.
In 1994, he was elected Executive Vice President and Chief
Operation Officer of Bell Atlantic. In 1991, he was elected
Chairman, President and Chief Executive Officer of Bell
Atlantic Enterprises International, Inc. and in 1990, he was
appointed President of Bell Atlantic Mobile Systems. He also
serves as a director of Grupo Iusacell, S.A. de C.V.
ROBERT TED ENLOE, III Director since 1986
Robert Ted Enloe, III, age 57, has served as President and
Chief Executive Officer of Liberte Investors since 1975. He
was President and a director of L&N Housing Corp. from 1981 to
April 1992 and he remains a director of that entity, now known
as LNH Reit, Inc. From 1975 to September 1991 he served as the
President of Lomas Financial Corporation, and as a director of
that company from 1970 to 1991. Mr. Enloe also serves as a
trustee of Liberte Investors, and as a director of Leggett &
Platt, Inc., Sixx Holdings, Incorporated, and Epikon, Inc.
GEORGE H. HEILMEIER Director since 1994
George H. Heilmeier, age 59, has served as President and Chief
Executive Officer of Bell Communications Research, Inc.
(Bellcore), since 1991. He was Senior Vice President and Chief
Technical Officer of Texas Instruments, Inc. from 1983 to 1991.
He is a member of the Defense Science Board, the President's
National Security Telecommunications Advisory Committee and the
National Academy of Engineering. Dr. Heilmeier also serves as
a member of the Board of Directors of TRW, Inc., MITRE
Corporation, and Automatic Data Processing Inc.
GEORGE E.R. KINNEAR II Director since 1988
George E.R. Kinnear II, age 68, is Chairman Emeritus of the
Board of the Retired Officers Association of the United States.
From November 1988 to January 1992 he served as Executive Vice
President of the University of New Hampshire (and as interim
President from February 1990 to August 1990). From 1982 to
1988, he served as a Vice President for Grumman Corporation or
its subsidiaries, last serving as Senior Vice President,
Washington Operations. He also serves as a member of the Board
of Directors for Precision Standard Corporation and The
Aerospace Corporation.
PETER N. LARSON Director since 1993
Peter N. Larson, age 56, has served as Chairman and Chief
Executive of Brunswick Corporation since April 1995. Prior to
joining Brunswick, he was an executive officer of Johnson &
Johnson where he served as Worldwide Chairman of the Consumer
and Personal Care Group, and was a member of the Executive
Committee and the Board of Directors. Prior to joining Johnson
& Johnson in 1991, he was a member of a partnership managing
consumer businesses. In addition to being a director of
Brunswick, he is also a member of The Advertising Educational
Foundation, Inc.
KENNETH L. LAY Director since 1987
Kenneth L. Lay, age 53, has served as Chairman of the Board and
Chief Executive Officer of Enron Corp., a diversified energy
company, since February 1986. In addition to Enron Corp., he
serves as a director of Eli Lilly & Company, Trust Company of
the West, and Enron Oil and Gas Company.
KENNETH ROMAN Director since 1991
Kenneth Roman, age 65, provides management consulting services.
From 1988 to 1989 he served as Chairman and Chief Executive
Officer of The Ogilvy Group (and from 1985 to 1989 as Chairman
of Ogilvy & Mather Worldwide). He was Executive Vice President
of American Express from 1989 to 1991. He serves as a director
of Brunswick Corporation, IBJ Schroder Bank and Trust Company,
and PennCorp Financial Group, Inc.
LUCILLE S. SALHANY Director since 1996
Lucille S. Salhany, age 49, has served as President and Chief
Executive Officer of United Paramount Network since September
1994. From January 1993 to July 1994 she served as Chairman of
FOX Broadcasting Company and also was a member of the Board of
Directors of Fox Inc. She joined FOX Broadcasting Company as
Chairman of Twentieth Television in July 1991 after serving as
President of Paramount Domestic Television of Paramount
Pictures since 1985. Ms. Salhany serves on the executive
committee of the UCLA School of Theater, Film and Television,
is a member of the Board of Directors of the Academy of
Television Arts and Sciences, and Hollywood Supports, an
entertainment industry organization, and also serves on the
Board of Emerson College.
These ten persons will be placed in nomination for
election to the Board of Directors. Directors will be elected
by a plurality of the affirmative votes cast. The shares
represented by the proxy cards returned will be voted FOR the
election of these nominees unless you specify otherwise.
BOARD ORGANIZATION AND MEETINGS
During 1995 the Board of Directors met eight times and
various committees of the Board met a total of eighteen times.
Attendance at Board meetings averaged 96 percent and attendance
at committee meetings averaged 95 percent. The directors
attended at least 81 percent of the meetings of the Board of
Directors and the committees on which they served.
The Audit Committee consists of seven non-employee
directors: Mr. Kinnear (Chair) and Messrs. Babbio, Enloe,
Heilmeier, Larson, Lay, and Rosen. The primary purpose of the
Audit Committee is to provide independent and objective
oversight of the Company's accounting functions and internal
controls and to assure the objectivity of the Company's
financial statements. The Committee also reviews and advises
the Board with respect to the Company's insurance coverage and
tax policies. The Committee is responsible for engaging the
Company's independent accountants and reviews with them (i) the
scope and timing of their audit services and any other services
they may be asked to perform, (ii) their report on the
Company's consolidated financial statements following
completion of the audit, and (iii) the Company's policies and
procedures with respect to internal accounting and financial
controls. This Committee meets separately with representatives
of the Company's independent accountants and with
representatives of senior management and the internal auditors.
The Audit Committee held six meetings during 1995, including
one telephonic meeting.
The Human Resources Committee, which formerly was known as
the Compensation Committee, consists of six non-employee
directors: Mr. Enloe (Chair) and Messrs. Heilmeier, Kinnear,
Larson, Lay, and Roman. The primary purpose of this Committee
is set forth in the Human Resources Committee Report in this
Proxy Statement. During 1995 this Committee held seven
meetings.
The Corporate Governance Committee, which formerly was
known as the Nominating Committee, consists of eight non-
employee directors: Mr. Larson (Chair) and Messrs. Babbio,
Enloe, Heilmeier, Kinnear, Lay, Roman, and Rosen. The primary
purpose of this Committee is set forth in the Corporate
Governance Committee Report in this Proxy Statement. The
Corporate Governance Committee held six meetings during 1995.
DIRECTORS' COMPENSATION
Board members other than those employed by the Company
receive an annual fee of $30,000 ($50,000 for the Chairman).
Prior to April 1996, Board members also have received a fee of
$1,000 for each Board meeting attended in person, and a fee of
$500 for each Board or committee special meeting held by
telephone. Each Committee chairman receives an additional fee
of $5,000 annually. Directors are reimbursed for travel and
certain other expenses incurred in connection with their duties
as directors of the Company. In connection with his role as
Chairman of the Board of Directors, the Company retained Mr.
Rosen to perform certain consulting services for the Company.
In 1995 he received $152,000 in consulting fees from the
Company.
The Company has adopted a stock option plan for non-
employee directors (the "Director Plan"), which authorizes
1,500,000 shares of Common Stock for issuance pursuant to stock
options granted to non-employee directors. In January 1996 the
Board of Directors amended the Director Plan to reduce the
number of shares granted effective April 1996. As of April
1996, (i) each newly-appointed director will receive an initial
option grant of 12,500 shares; (ii) each non-employee director
will receive an annual option grant of 10,000 shares upon re-
election; (iii) the director named as Chairman of the Board
will receive an option to acquire an additional 2,500 shares;
and (iv) six months prior to each annual meeting each non-
employee director may file an election to receive in lieu of
all or a portion of the following year's annual retainer a
stock option grant, for which the number of shares and the
exercise price are based upon 50 percent of the closing price
of Common Stock on the day of the annual meeting.
Under the Director Plan prior to April 1996, (i) each
newly-appointed director is granted an option to purchase
30,000 shares of Common Stock at an exercise price equal to the
market value of the Common Stock on the date of the grant;
(ii) each year upon re-election to the Board each non-employee
director receives an option grant to acquire 12,000 shares of
Common Stock or, in the case of the director named as Chairman
of the Board, an option to acquire 15,000 shares of Common
Stock with an exercise price equal to the market value of the
Common Stock on the day of grant; and (iii) six months prior to
each annual meeting each non-employee director may file an
election to receive in lieu of all or a portion of the
following year's annual retainer a stock option grant, for
which the number of shares and the exercise price are based
upon 50 percent of the closing price of Common Stock on the day
of the annual meeting. Upon his appointment to the Board on
September 29, 1995, Mr. Babbio received an option grant with an
exercise price of $48.38 per share. On April 26, 1995, Messrs.
Rosen, Enloe, Heilmeier, Kinnear, Larson, Lay and Roman each
received an option grant upon re-election with an exercise
price of $39.00 per share. Mr. Rosen was granted an option to
purchase 2,564 shares and Messrs. Kinnear, Larson, Lay and
Roman each were granted options to purchase 1,538 shares, at an
exercise price of $19.50, as a result of their elections to
receive options in lieu of annual retainer fees. Ms. Salhany
will receive an option grant with an exercise price equal to
the current market value of the Common Stock on the fifth
business day following the Company's earnings release for the
first quarter 1996.
As part of its overall program to promote charitable
giving, the Company has established a directors' charitable
donation program funded by life insurance policies on
directors. Upon the death of an individual who has served as a
director for three years, the Company will donate $1 million to
one or more qualifying charitable organizations recommended by
the individual director and subsequently will be reimbursed by
life insurance proceeds. Individual directors derive no
financial benefit from this program since all charitable
donations are made by the Company. The program does not result
in any material cost to the Company.
EXECUTIVE OFFICERS
The Board elects executive officers annually at its first
meeting following the annual meeting of stockholders. Certain
information concerning the Company's executive officers is set
forth below, except that information concerning Mr. Pfeiffer is
set forth above under "Election of Directors."
Andreas Barth, age 51, was elected Senior Vice President,
Europe, Middle East and Africa in December 1991. He joined the
Company in February 1988 as Managing Director of Compaq
Computer GmbH, the Company's German subsidiary, was appointed
Vice President, Central Europe in December 1990, and Vice
President, Europe in January 1991.
Ross A. Cooley, age 55, was elected Senior Vice President,
North America in December 1991. He joined the Company in
February 1984 as a regional sales manager, and was appointed
Vice President, Sales in April 1987, Vice President, Sales and
Service in September 1989, and Vice President, North America in
January 1991.
Wilson D. Fargo, age 51, was elected Senior Vice
President, General Counsel and Secretary of the Company in May
1989. He joined the Company in September 1984 as Vice
President and General Counsel and he was appointed Secretary of
the Company in October 1984.
Hans W. Gutsch, age 52, was elected Senior Vice President,
Human Resources in November 1994. Mr. Gutsch joined the
Company in 1988 as Director, Human Resources, Europe and was
appointed Vice President, Human Resources, Europe, in June
1992, and Vice President, Human Resources and Environment,
Europe, Middle East and Africa in January 1993.
Michael D. Heil, age 48, was elected Senior Vice President
and General Manager, Consumer Products Division in September
1995. Prior to his arrival at the Company, he was President and
General Manager of Los Angeles Cellular Telephone Company since
May 1989.
Gregory E. Petsch, age 45, was elected Senior Vice
President, Corporate Operations in July 1993. He joined the
Company in September 1983 as Director of Manufacturing Control
and was named Vice President, CPU Manufacturing in May 1989 and
Vice President, Manufacturing in November 1991.
John T. Rose, age 50, joined the Company as Senior Vice
President, Desktop PC Division, in July 1993. Prior to his
arrival at the Company, he was Vice President of Digital
Equipment Corporation's Personal Computing Systems Business,
which he established in 1985.
Robert W. Stearns, age 45, was elected Senior Vice
President, Technology, Corporate Development and Marketing in
January 1996. He joined the Company as Vice President of
Corporate Development in July 1993. Prior to his arrival at
the Company, he was employed as a consultant focusing on high
technology issues with McKinsey & Co. from August 1992 to July
1993 and as Vice President, Corporate Marketing with
Motorola/Codex from September 1986 to August 1992. He also
serves as a director of Houston Advanced Research Center.
Gary Stimac, age 44, was elected Senior Vice President,
Systems Division, in October 1991. He joined the Company in
February 1982 as a systems engineer and was elected Vice
President, Engineering in January 1986, Vice President, Systems
Engineering in May 1987, and Senior Vice President, Systems
Engineering in May 1989.
Daryl J. White, age 48, was elected Senior Vice President,
Finance and Chief Financial Officer in May 1989. He joined the
Company in January 1983 as Director of Information Management
and was elected Corporate Controller in May 1984, Vice
President and Corporate Controller in January 1986, and Vice
President, Finance and Chief Financial Officer, in October
1988. He also serves as a director of Pinnacle Micro Inc.
Michael J. Winkler, age 51, was elected Senior Vice
President, Portable PC Division, upon joining the Company in
November 1995. Prior to his arrival at the Company, he was a
Vice President and General Manager of the Computer Systems
Division of Toshiba America Information Systems since October
1991. Previously, he was Vice President at Xerox Corporation.
David J. Schempf, age 40, was elected Vice President,
Corporate Finance, Corporate Controller, and Treasurer in
November 1992. He joined the Company in October 1982 as
accounting manager and later served as controller of the office
and personal computer divisions and was elected Vice President
and Corporate Controller in May 1989.
John W. White, age 57, was elected Vice President and
Chief Information Officer upon his joining the Company in
February 1994. Before joining the Company, Mr. White was Vice
President of Texas Instruments, Inc., and President of its
Information Technology Group. He was employed by Texas
Instruments for 28 years and served in a number of positions.
STOCK OWNERSHIP
The following information, as of February 27, 1996,
relates to (i) the holders of the Company's Common Stock known
to the Company to own beneficially 5 percent or more of the
outstanding Common Stock, and (ii) the ownership of Common
Stock by each director; the Chief Executive Officer and the
four most highly compensated other executive officers; and the
executive officers and directors as a group. For purposes of
this Proxy Statement, beneficial ownership of securities is
defined in accordance with the rules of the Securities and
Exchange Commission (the "SEC") to mean generally the power to
vote or dispose of securities, regardless of any economic
interest therein. The Company had 268,092,992 shares of Common
Stock outstanding as of February 27, 1996.
<TABLE>
<CAPTION>
Name of Owner or Number of Shares Percent of
Identity of Group Options(1) Total (1) Outstanding
<S> <C> <C> <C>
FMR Corp.
82 Devonshire Street
Boston, MA 02109 29,356,110 (2) 10.95%
The Equitable Companies
Incorporated (3)
787 Seventh Avenue 15,169,597 5.7
New York, New York
10019
Benjamin M. Rosen 224,105 1,442,069 *
Eckhard Pfeiffer 1,310,854 1,312,534 (4) *
Lawrence T. Babbio, Jr. 0 0 *
Robert Ted Enloe, III 90,000 90,000 *
George E.R. Kinnear II 43,538 45,538 *
George H. Heilmeier 36,000 36,300 *
Peter N. Larson 49,538 50,138 *
Kenneth L. Lay 39,194 137,951 (5) *
Kenneth Roman 63,194 73,694 *
Andreas Barth 323,422 324,412 *
Ross A. Cooley 22,253 22,253 *
Gary Stimac 164,174 230,351 (6) *
Gregory E. Petsch 48,902 51,641 (7) *
All executive officers
and directors as a group 2,774,869 4,186,659 (8) 1.56
<FN>
* Less than 1%
(1) Includes Company stock options that are exercisable or
will become exercisable by April 27, 1996.
(2) Based on information provided in Schedule 13G and
amendments thereto filed with the SEC dated February 14, 1996,
these shares are beneficially held by FMR Corporation ("FMR")
and certain of its affiliates and associates.
(3) The number of shares indicated is based on information
provided in Schedule 13G filed with the SEC dated February 9,
1996, which was filed jointly by five French mutual insurance
companies (AXA Assurances I.A.R.D. Mutuelle, AXA Assurances Vie
Mutuelle, Alpha Assurances I.A.R.D. Mutuelle, Alpha Assurances
Vie Mutuelle, and Uni Europe Assurance Mutuelle, and
collectively as a group, "The Mutuelles AXA"), as a group, AXA,
The Equitable Companies Incorporated, and their subsidiaries.
According to the Schedule 13G, 22,100 shares are beneficially
owned by The Mutuelles AXA and AXA; and the shares beneficially
owned by subsidiaries of The Equitable Companies Incorporated
are as follows: (i) The Equitable Life Assurance Society of the
United States: 557,300 shares; (ii) Alliance Capital Management
L.P.: 14,559,947 shares; (iii) Donaldson, Lufkin & Jenrette
Securities Corporation: 2,800 shares; and Wood, Struthers &
Winthrop Management Corporation.
(4) Includes 1,680 shares held by daughter and in custody for
a minor child.
(5) Includes 98,757 shares held by limited partnership.
(6) Includes 4,185 shares of Common Stock credited to Mr.
Stimac's account in the Company's defined contribution plan.
(7) Includes 2,739 shares of Common Stock credited to Mr.
Petsch's account in the Company's defined contribution plan.
(8) Includes 2,434 shares of Common Stock credited to the
executive officers' accounts in the Company's defined
contribution plan, which have not been listed separately
above.
</FN>
</TABLE>
EXECUTIVE COMPENSATION
The following Tables I through III present information
concerning the cash compensation and stock options provided to
Messrs. Pfeiffer, Barth, Cooley, Petsch, and Stimac. The notes
to these tables provide more specific information regarding
compensation. Table IV sets forth the anticipated retirement
benefits to be received by Mr. Pfeiffer and Mr. Barth under the
defined benefit retirement plan of the Company's German
subsidiary. The Company's compensation policies are discussed
in the Human Resources Committee Report that begins on page 11.
<TABLE>
TABLE I
SUMMARY COMPENSATION
<CAPTION>
Long-Term
Annual Compensation (1) Compensation
Securities
Principal Other Annual Underlying All Other
Position Year Salary Bonus Compensation Options (2) Compensation
=======================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Eckhard Pfeiffer 1995 $1,125,000 $2,500,000 -- 320,000 $1,250,000(3)
Chief Executive 1994 1,050,000 2,500,000 $1,500,019(4) 290,000 750,000(3)
Officer 1993 1,000,000 1,500,000 -- 360,000 --
Andreas Barth 1995 537,473 555,459 -- 100,000 189,053(3)
Senior Vice President 1994 431,672 482,626 -- 85,000 128,480(3)
EMEA 1993 380,573 350,590 -- 120,000 --
Ross A. Cooley 1995 360,000 550,000 -- 85,000 225,000(3)
Senior Vice President 1994 340,000 550,000 -- 85,000 229,500(5)
North America 1993 321,766 450,000 -- 120,000 8,994(6)
Gregory E. Petsch 1995 350,000 525,000 -- 100,000 271,000(7)
Senior Vice President 1994 300,000 500,000 -- 85,000 206,000(8)
Corporate Operations 1993 275,000 400,000 -- 120,000 8,937(6)
Gary Stimac 1995 470,000 700,000 -- 120,000 303,200(9)
Senior Vice President 1994 450,000 550,000 -- 85,000 252,000(10)
Systems Division 1993 430,000 450,000 -- 120,000 8,994(6)
<FN>
(1) Amounts shown include cash compensation earned by
executive officers as well as amounts earned but deferred.
Management believes that the value of any other benefits to any
officer during 1993, 1994 and 1995 or to any officer other than
Mr. Pfeiffer during 1994 did not exceed $50,000 or fall within
any other category requiring inclusion.
(2) All figures in this column reflect the number of shares
adjusted to reflect the Company's three-for-one stock split in
1994.
(3) Amount reflects a deferred unfunded bonus, the payment of
which is subject to conditions established by the Human
Resources Committee of the Board of Directors.
(4) In accordance with the employment agreement between the
Company and Mr. Pfeiffer executed in 1992, the Company paid
these funds to Mr. Pfeiffer to reimburse him for U.S. taxes
incurred in 1994 upon exercise of certain stock options.
(5) Amount shown includes $4,500 contributed to the Company's
defined contribution plan on behalf of Mr. Cooley and a
$225,000 deferred unfunded bonus, the payment of which is
subject to conditions established by the Human Resources
Committee of the Board of Directors.
(6) Amount contributed to the Company's defined contribution
plan on behalf of the named executive officers.
(7) Amount shown includes $21,000 contributed to the Company's
defined contribution plan and defined compensation and
supplemental savings plan on behalf of Mr. Petsch and a
$250,000 deferred unfunded bonus, the payment of which is
subject to conditions established by the Human Resources
Committee of the Board of Directors.
(8) Amount shown includes $6,000 contributed to the Company's
defined contribution plan and deferred compensation and
supplemental savings plan on behalf of Mr. Petsch and a
$200,000 deferred unfunded bonus, the payment of which is
subject to conditions established by the Human Resources
Committee of the Board of Directors.
(9) Amount shown includes $28,200 contributed to the Company's
defined contribution plan and deferred compensation and
supplemental savings plan on behalf of Mr. Stimac and a
$275,000 deferred unfunded bonus, the payment of which is
subject to conditions established by the Human Resources
Committee of the Board of Directors.
(10) Amount shown includes $27,000 contributed to the
Company's defined contribution plan and deferred compensation
and supplemental savings plan on behalf of Mr. Stimac and a
$225,000 deferred unfunded bonus, the payment of which is
subject to conditions established by the Human Resources
Committee of the Board of Directors.
</FN>
</TABLE>
<TABLE>
TABLE II
1995 OPTION EXERCISES
AND YEAR-END OPTION VALUES
<CAPTION>
Number of Unexercised Value of Unexercised
Options at in-the-Money Options
1995 Stock Option Exercises December 31, 1995 at December 31, 1995
<S> <C> <C> <C> <C> <C> <C>
Shares Value Realized Exercisable Unexercisable Exercisable Unexercisable
Eckhard Pfeiffer 400,000 $12,492,853 1,197,517 992,483 $40,163,674 $18,025,925
Andreas Barth 97,000 3,269,801 309,753 306,247 10,491,764 5,525,349
Ross A. Cooley 86,164 2,271,859 47,090 276,248 1,439,157 4,974,556
Gregory E. Petsch 115,222 3,589,876 18,634 297,547 569,614 5,193,192
Gary Stimac 100,000 4,195,533 124,505 340,495 3,619,291 6,057,840
</TABLE>
<TABLE>
TABLE III
1995 STOCK OPTION GRANTS
<CAPTION>
Gains Based on Assumed
Rates of Stock Price
Appreciation for Option
1995 Stock Option Grants Term (1)
% of 1995 Exercise/
Options Employee Base Price Expiration Assumed Rate Assumed Rate
Granted Option per Share Date 5% 10%
(2) Grants 9/28/95
===========================================================================================
<S> <C> <C> <C> <C> <C> <C>
Eckhard Pfeiffer 320,000 4.89% $48.3800 9/28/05 $9,736,295 $24,673,683
Andreas Barth 100,000 1.52 48.3800 9/28/05 3,042,592 7,710,526
Ross A. Cooley 85,000 1.30 48.3800 9/28/05 2,586,203 6,553,947
Gregory E. Petsch 100,000 1.52 48.3800 9/28/05 3,042,592 7,710,526
Gary Stimac 120,000 1.83 48.3800 9/28/05 3,651,111 9,252,631
All stockholders: N/A N/A N/A N/A 8 billion 20.5 billion
265,828,051 shares
outstanding as of
9/28/95
Named officers' .27% .27%
gain as % of all
stockholders' gain
<FN>
(1) The potential gain is calculated from the closing price of
Common Stock on September 28, 1995, the date of grants to
executive officers. These amounts represent certain assumed
rates of appreciation only. Actual gains, if any, on stock
option exercises and Common Stock holdings are dependent on the
future performance of the Common Stock and overall market
conditions. There can be no assurance that the amounts
reflected in this table will be achieved.
(2) Option grants vest over 60 months from the date of grant
and expire ten years from the date of grant.
</FN>
</TABLE>
<TABLE>
<CAPTION>
TABLE IV
GERMAN PENSION PLAN
Final Average Annual Pension Benefits without Reductions
Eckhard Pfeiffer Base Salary for Anticipated Social Security and Prior
Employer Pension Benefits
======================================================================================
Years of Service 15 20 25 30 35
======================================================================================
<S> <C> <C> <C> <C> <C> <C>
$ 900,000 $ 352,174 $ 469,565 $ 540,000 $ 540,000 $ 540,000
1,000,000 391,304 521,739 600,000 600,000 600,000
1,100,000 430,435 573,913 660,000 660,000 660,000
1,200,000 469,565 626,087 720,000 720,000 720,000
1,300,000 508,696 678,261 780,000 780,000 780,000
<CAPTION>
Final Average Annual Pension Benefits without Reduction
Andreas Barth Base Salary for Anticipated Social Security Benefits
======================================================================================
Years of Service 15 20 25 30 35
======================================================================================
<S> <C> <C> <C> <C> <C> <C>
$ 400,000 $ 120,000 $ 160,000 $ 200,000 $ 240,000 $ 280,000
500,000 150,000 200,000 250,000 300,000 350,000
600,000 180,000 240,000 300,000 360,000 420,000
700,000 210,000 280,000 350,000 420,000 490,000
800,000 240,000 320,000 400,000 480,000 560,000
</TABLE>
Table IV indicates anticipated benefits at age 65 assuming
the years of service with the Company shown. At December 31,
1995, Mr. Pfeiffer and Mr. Barth had twelve years and seven
years of vested service, respectively. Benefits for Mr.
Pfeiffer are calculated based on a formula under which he
receives benefits equal to 60 percent of his average base
salary over his final three years of employment. Any benefit
is offset by U.S. and German social security benefits, pension
payments from previous employers, and any amounts contributed
by the Company on his behalf to the U.S. defined contribution
plan. Benefits for Mr. Barth are calculated based on a formula
under which he receives an annual retirement benefit equal to
two percent of his final base salary times his years of
service. This benefit will be offset by German social security
benefits. The Company's executive officers in the United
States are eligible to participate in the Company's defined
contribution plan and defined contribution and supplemental
savings plan. Amounts contributed to the defined contribution
plan and defined contribution and supplemental savings plan are
included in Table I.
Executive Officer Agreements
Effective January 1, 1992, the Company entered into an
employment agreement with Mr. Pfeiffer (the "CEO Agreement").
The CEO Agreement sets forth certain of the terms of
Mr. Pfeiffer's employment, including Mr. Pfeiffer's right to
receive a severance payment equal to four times his base salary
(excluding bonuses) upon (i) termination of employment without
cause or (ii) his resignation following his removal as Chief
Executive Officer or a change of control of the Company. In
such events, the CEO Agreement also calls for Mr. Pfeiffer to
vest in all his outstanding stock options and to have a two-
year period to exercise options granted before 1989. Mr.
Pfeiffer's right to receive the severance payment, accelerated
stock option vesting, and an extension of the period to
exercise his options is subject to his execution of a release
of any claims against the Company and his agreement not to
compete with the Company or solicit its employees for 24 months
following termination of employment. The agreement set forth
Mr. Pfeiffer's base compensation for 1992 and calls for Mr.
Pfeiffer and the Company to renegotiate Mr. Pfeiffer's base
salary on an annual basis. The CEO Agreement also set forth
the Company's agreement to indemnify Mr. Pfeiffer for certain
personal income taxes related to his relocation to the United
States in 1991, which obligation has been fulfilled. The CEO
Agreement governs the terms and conditions of Mr. Pfeiffer's
employment with the Company until he resigns or his employment
is terminated at any time by the Company, with or without
cause.
The Company has entered into severance arrangements with
Messrs. Barth, Cooley, Petsch and Stimac. The Company has
agreed with each of these officers that upon (i) termination of
employment without cause or (ii) resignation following a
material change in the officer's duties, a change of control,
disability, a reduction in pay greater than 25 percent, or the
Company's failure to renew the agreement, such officer would
receive a severance payment equal to eighteen months of base
compensation. The Company's obligation to make such payment is
subject to the officer's execution of a release and
noncompetition and nonsolicitation agreement.
The Company's stock option plans provide for full vesting
of outstanding options in the event there is a change of
control of the Company.
HUMAN RESOURCES COMMITTEE REPORT
The primary purpose of the Human Resources Committee of
the Board of Directors, which is composed of independent
outside directors, is to ensure that the human resource and
compensation strategies of the Company support and enhance its
strategic objectives. The Committee is responsible for
reviewing and advising the Board with respect to the Company's
human resource strategies, setting the policies that govern the
Company's compensation programs, administering the Company's
equity compensation plans, and establishing the cash
compensation of executive officers. The Committee's objectives
are to establish compensation programs designed to attract,
retain, and reward executives who will lead the Company in
achieving its business goals in a highly competitive and
rapidly changing industry; to ensure that the Company fulfills
its ethical and legal responsibilities to its employees; and to
ensure that management compensation is reasonable in light of
the Company's objectives, compensation for similar personnel at
other companies, and other relevant criteria. The compensation
mix for executive officers consists of base salaries, an annual
cash bonus system, and stock option awards. As a result, much
of an executive officer's compensation is based upon the
financial performance of the Company.
The Committee makes its compensation decisions based on an
analysis of the Company's performance, and an evaluation of
comparative compensation information, and an evaluation of the
performance of executive officers. Comparative performance
data in 1995 was based on a group of 35 industry competitors,
which included all of the companies in the S&P Computer Systems
Index as well as certain other companies. The peer group is
recommended to the Committee by an outside consulting firm,
which analyzes companies for similar product lines, size, and
financial structure. In 1995 the Company's performance placed
the Company at about the 80th percentile in the peer group
based on an evaluation of return on total capital and sales
growth, which are highly correlated with long-term stockholder
value creation.
Comparative compensation data in 1995 was derived from an
analysis of several independent surveys of compensation
practices by the Company and outside consultants. Information
from the computer and electronics industry segments is used
wherever available. Nearly all of the companies in the
comparative performance analysis are included in one or more of
the surveys used to assess comparative compensation practices.
The Committee believes these sources provide the appropriate
information to evaluate the cash and equity compensation pay
practices of the companies with which the Company competes to
hire and retain executives.
The Committee annually establishes each executive
officer's base salary based on the Committee's evaluation of
the officer's performance and contribution in the previous year
and on competitive pay practices. The Company targets
executive base salary range midpoints at the 62nd percentile of
relevant market data. The Committee determined each executive
officer's base compensation for 1995, including the Chief
Executive Officer's, based upon an appraisal of the officer's
contribution to the Company's results in 1994 and the
officer's position and responsibilities for 1995. The
criteria used in this appraisal varied based upon the officer's
sphere of responsibility, but generally focused on measures
such as sales growth in marketing and sales divisions, an
assessment of plans for existing and new products in product
divisions, expense control, and asset management.
Each year, in accordance with the limits
established under the Company's Bonus Incentive Plan, the
Committee establishes a cash bonus fund based on the Company's
performance relative to the industry peer group. In 1995 the
Committee evaluated comparative compensation data to determine
the aggregate amount required to pay bonuses that would result
in average total cash compensation to executives at the 80th
percentile level, in line with the Company's performance in
1995. The Committee then determined the amount of the award
for each executive officer by reviewing comparative data for
each executive officer's position at the 80th percentile total
cash compensation levels and evaluating this information in
light of individual contribution levels, succession plans,
prospective future contributions, and retention requirements.
In establishing Mr. Pfeiffer's bonus, the Committee considered
at length Mr. Pfeiffer's performance in 1995, focusing on three
aspects of Mr. Pfeiffer's performance as Chief Executive
Officer: operational and financial results, strategic
planning, and leadership. Mr. Pfeiffer's direction of the
Company's operations in 1995 resulted in record-setting financial
performance, including an annual sales increase to $14.8
billion from $10.9 billion in 1994, an increase in earnings per share to
$3.74 (excluding a one-time charge related to acquisition activity)
from $3.21 in 1994, and more than 20 percent annual growth in the
number of unit shipments worldwide. Mr. Pfeiffer's development
and implementation of effective strategies to ensure the Company's
continued growth and financial success led to significant steps
in the Company's transition from a PC company to a computer company,
including the Company's acquisition of NetWorth, Inc., and Thomas-Conrad
Corporation and other strategic investments, and, in
particular, the continuation of the industry and financial
community's confidence in Mr. Pfeiffer's leadership. Mr.
Pfeiffer's skills in identifying, hiring, and retaining an
effective management team led to the hiring of several key
executives, including new general managers of two product
divisions as well as the further development of succession
planning strategies for Mr. Pfeiffer and his team. The
Committee authorizes the Chief Executive Officer to allocate
the remainder of the bonus fund to key employees other than
executive officers based on competitive pay practices and
individual performance and contributions.
The Human Resources Committee and the Board of Directors
believe that management's ownership of a significant equity
interest in the Company is a major incentive in building
shareholder wealth and aligning the long-term interests of
management and stockholders. Stock options, therefore, are
granted by the Committee at option prices not less than the
fair market value of the Company's common stock on the grant
date and vest over sixty months. As a result, stock options
have no value unless the share price increases over the fair
market value on the date of grant. Option awards contribute to
the retention of key executives since executives realize the
benefits of options only as they vest based on tenure after the
grant. The Human Resources Committee determines which
employees receive stock option grants by evaluating the
responsibilities and relative positions of key employees in
comparison to like or similar positions at competitor
companies.
The Committee uses competitive market data and historical
option grant practices to determine an appropriate range of
awards for similar positions and makes awards within this range
based on an evaluation that takes into consideration the
employee's past and prospective contributions to the success of
the Company as well as the projected value of outstanding
unvested shares and proposed awards. To evaluate projected
values, the Committee uses stock price projections two years in
the future that are based on Value Line predictions of the
industry share growth rate. Based on the Company's performance
in comparison to the peer group, the Committee determined that
in 1995 options should be awarded to Mr. Pfeiffer and other
key executives at levels approximating those in 1994. The
Committee determined, however, to further differentiate in
grant levels among key executives, based on performance
evaluation, prospective further contribution, and retention
requirements.
In addition, effective September 29, 1995, the Board of
Directors adopted an Executive Stock Ownership Policy that
requires executive officers to own a certain number of shares
of Common Stock. Mr. Pfeiffer is required to own 45,000 shares
and each of the other executive officers is required to own
10,000 shares. Each employee subject to this policy has the
greater of three years from the effective date of the policy or
five years from election to a covered position to comply with
the ownership requirement.
In its tax years beginning December 1, 1994, the Company
is subject to Internal Revenue Code Section 162(m), which could
limit the deductibility of certain compensation payments to its
executive officers. The Company believes that any compensation
realized in connection with the exercise of stock options
granted by the Company will continue to be deductible as
performance-based compensation. The Committee evaluated the
impact of this legislation on its cash and equity compensation
programs and adopted two additional compensation plans,
which were approved by the stockholders of the Company in
April 1995. The Company believes that compensation paid under
the new Bonus Incentive Plan and that compensation realized
in connection with grants under the 1995 Equity Incentive
Plan qualify for full deductibility under Section 162(m).
The Company generally intends to comply with the requirements
of Section 162(m); however, it also intends to weigh the burdens
of such compliance against the benefits to be obtained by the
Company from such compliance, and in the future may pay compensation
that is not fully deductible if it determines that such
payments are in the Company's best interests.
Human Resources Committee
Robert Ted Enloe, III, Chair Peter N. Larson
George H. Heilmeier Kenneth L. Lay
George E.R. Kinnear II Kenneth Roman
CORPORATE GOVERNANCE COMMITTEE REPORT
Compaq Computer Corporation has focused on corporate
governance since it was incorporated in 1982, long before the
term came into fashion. From its beginning, the Board of
Directors has consisted of independent outside directors except
for one director who is an executive officer of the Company.
All Board committees are composed exclusively of outside
directors. The roles of Chairman and Chief Executive Officer
have been and are separate. Directors have been compensated
largely in equity to align their interests with shareholders.
But Board structure has only one means to an end of ensuring
the Board of Director's active oversight over the management of
the Company's business. Through its continuing participation
in strategic reviews of results, plans, and policies, the Board
has been ready to make the difficult decisions that have led to
timely changes in management and business plans.
In July 1985 the Board of Directors first communicated its
governance goals to employees by adopting the Board of
Director's Statement of Purpose and Responsibilities. Since
that time the Board has periodically updated the Statement, the
charters of the Committees of the Board of Directors, and the
Company's Delegation of Authority Policy. These documents set
forth the principal corporate governance guidelines for the
Board, the Company's executive officers, and employees.
In January 1996 the Board of Directors, upon
recommendation of the Committee, restructured the Nominating
Committee as the Corporate Governance Committee and expanded
the scope of its corporate governance responsibilities. The
Corporate Governance Committee is charged with establishing
processes and procedures to ensure effective and responsive
governance of the Company. This includes responsibility for
adopting procedures for the selection, retention, and
evaluation of a Board of Directors that will perform its
functions objectively and responsibly. The Committee is also
responsible for evaluating and recommending to the Board
corporate governance principles for the Company and the Board
of Directors. The recommendations may include amendments to
the Bylaws, the Board Statement of Purpose and Responsibilities
or charters of Board Committees, and the adoption of
principles, policies, procedures, or operational methods so as
to insure more effective and responsive governance of the
Company.
In January 1996 the Board adopted seven principles of
corporate governance that govern the selection of Board
candidates, compensation of Board members, and Board retirement
policies. These principles, which will be reviewed, updated,
and communicated to stockholders periodically, are listed
below:
1. The Board of Directors shall be limited to ten or fewer
members with the Chief Executive Officer as the only member who
is an executive officer except in times of Chief Executive
Officer transition. The Board will seek a balance between
outside directors coming from business leadership positions and
those who bring special expertise by favoring those who come
from positions of leadership.
2. All Committee members will be outside directors.
3. Committee chairs will serve for two years and be rotated
thereafter.
4. Board compensation will be paid in equity grants and an
annual retainer. No meeting fees will be paid for regularly
scheduled Board meetings effective with the 1996 annual
meeting. Retainers may alternatively be paid in stock options
at the election of the individual director. Non-employee
directors will maintain ownership of 2,000 shares of Common
Stock by the later of three years from January 1996 or their
first election to the Board.
5. Outside directors will not be paid for consulting nor will
their firms be retained by the Company for consulting or
services without the approval of the full Board.
6. Board members will continue to be re-elected on an annual
basis. In addition:
Board members will evaluate the effectiveness of the full
Board annually;
Individual directors will be evaluated in depth by the
Corporate Governance Committee and Chief Executive Officer
every three years;
Board members will retire at age 70; and
Directors will offer their resignation upon a change of
position, including retirement from the position on which their
original nomination was based.
7. The Corporate Governance Committee will maintain a
director orientation program for both new and
continuing directors.
Corporate Governance Committee
Peter N. Larson, Chair George E.R. Kinnear II
Lawrence T. Babbio, Jr. Kenneth L. Lay
Robert Ted Enloe, III Kenneth Roman
George H. Heilmeier Benjamin M. Rosen
STOCK PERFORMANCE GRAPH
The following graph compares the Company's cumulative
total return to the S&P 500 and the S&P Computer Systems
Composite Index over a five-year period, beginning December 31,
1990, and ending December 31, 1995. The total stockholder
return assumes $100 invested at the beginning of the period in
Compaq Common Stock, the S&P 500, and the S&P Computer Systems
Composite Index. It also assumes reinvestment of all
dividends. Past financial performance should not be considered
to be a reliable indicator of future performance, and investors
should not use historical trends to anticipate results or
trends in future periods.
TABLE V
Comparison of Five-Year Cumulative Total Return
(Linear graph with coordinates indicated in the table below)
1990 1991 1992 1993 1994 1995
========================================================================
Compaq Computer Corporation 100 47 86 131 210 255
S&P 500 Composite 100 130 140 155 157 215
S&P Computer Systems Composite 100 89 65 68 87 116
GENERAL INFORMATION
Price Waterhouse LLP, independent accountants, has served
as the independent accountants of the Company since 1982, the
year of the Company's incorporation, and has been appointed to
audit the Company's consolidated financial statements for 1996.
The Board has not proposed that any formal action be taken at
the meeting with respect to the employment of Price Waterhouse
LLP inasmuch as no such action is legally required.
Representatives of Price Waterhouse LLP plan to attend the
annual meeting and will be available to answer appropriate
questions. Representatives of Price Waterhouse LLP will have
the opportunity to make a statement at the meeting if they so
desire.
Proposals of shareholders that are intended to be presented
at the Company's 1997 annual meeting of stockholders must be
received by the Company no later than November 9, 1996, to be
included in the proxy statement and proxy relating to that
meeting.
Your vote is important!
Please sign and return your proxy in the enclosed envelope.
COMPAQ LOGO!
COMPAQ COMPUTER CORPORATION
Notice of
ANNUAL MEETING OF STOCKHOLDERS
To be held April 25, 1996
To Our Stockholders:
Compaq Computer Corporation's Annual Meeting of Stockholders will be
held Thursday, April 25, 1996, at 10:00 AM at the Conference Center, CCA5,
Compaq Computer Corporation, 20555 SH 249, Houston, Texas.
Details of the business to be conducted at the Annual Meeting are
provided in the enclosed Notice of Annual Meeting of Stockholders and Proxy
Statement.
Stockholders of record at the close of business on February 27, 1996,
will be entitled to vote at the Annual Meeting or any adjournments thereof.
COMPAQ COMPUTER CORPORATION
Annual Meeting of Stockholders to be held April 25, 1996
This Proxy is Solicited on Behalf of The Board of Directors
The undersigned hereby appoints Daryl J. White and Wilson D.
Fargo, and each of them, with full power of substitution, proxies
of the undersigned to vote all shares of Common Stock of Compaq
Computer Corporation that the undersigned is entitled to vote at
the Annual Meeting of Stockholders to be held April 25, 1996, and
any adjournments thereof, with all the powers the undersigned would
possess if personally present, and particularly, without limiting
the generality of the foregoing, to vote and act on the following
matters and in their descretion upon such other business as may
properly come before the meeting or any adjourment thereof.
THIS PROXY WILL BE VOTED AS SPECIFIED. IF NO SPECIFICATION IS MADE,
THIS PROXY WILL BE VOTED "FOR" THE ELECTION OF EACH DIRECTOR NOMINEE
NAMED HEREIN.
(continued, and to be signed, on the reverse side) SEE REVERSE SIDE
The Board of Directors recommends a vote FOR the Proposal
Proposal: Election of ten directors of the Company
NOMINEES: Benjamin M. Rosen; Eckhard Pfeiffer; Lawrence T. Babbio, Jr.;
Robert Ted Enloe, III; George H. Heilmeier; George E.R.
Kinnear II; Peter N. Larson; Kenneth L. Lay; Kenneth Roman;
and Lucille S. Salhany.
For Withheld from To withold authority to vote
All Nominees All Nominees for any individual nominee(s),
mark this box and strike name
from the listing above.
I plan to attend the meeting:
Mark here for address change and note below:
Please sign as name appears, joint owners should each sign. When
signing as attorney, executor, administrator, trustee or guardian,
please give full title as such. If signer is a corporation, please
sign with the full corporation name by authorized officer or officers.
Signature(s)_______________Signature(s)---------------Date-------------
